Minimum wage maxed out

Judith Sloan
March 28, 2013
The Australian

HERE we go again. The ACTU wants the Fair Work Commission to raise the national minimum wage by $30 a week, to $636 a week. This would take the minimum hourly rate of pay to $16.75 an hour, an increase double the rate of inflation.

And for workers earning more than $18.58 an hour, the ACTU wants award wages increased by 4.2 per cent.

It seems that the union bosses were not happy with the increase granted last year – nearly 3 per cent or $17 a week. The ACTU, along with Oliver Twist, had wanted more. And this is a complaint from the head of an organisation that recently required downsizing because expenses had become too high in relation to income.

Somewhat surprisingly, Workplace Relations Minister Bill Shorten appears to be less than fully supportive of the $30-a-week claim made by his union mates. Steady on, he says – a figure somewhat lower than that, surely.

But in keeping with the gutless approach of this government and the previous government, the submission that Julia Gillard and Shorten will finalise will fail to mention a specific figure, leaving the final judgment to the wise men and women of the Minimum Wage Panel of the FWC. According to ACTU secretary Dave Oliver, the unions’ claim is “affordable and reasonable”. In fact, he makes the startling assertion that, as result of last year’s decision, we have already started along the path of “American-style class of working poor in Australia”.

Of course, this assertion does not pass the laugh test. The current minimum wage in the US is around $7 and applies only to the lowest paid.
In Australia, casual workers on award wages, who make up the bulk of part-time workers, enjoy a premium of 25 per cent on the hourly rate. In addition, penalty rates for “non-standard” hours of work range from time and a half to double time and a half.

It is easy to see how even the lowest paid workers can earn more than $50 an hour on Sundays and public holidays. It is equally easy to see why some employers simply refuse to open for business on Sundays and public holidays.

In fact, pub owner Chris Morris had decided to shut quite a few of his hotels over the Easter break. Citing a doubling of his wages bill on public holidays, he expresses the view that “I am not sure who is winning. I’m not winning because I can’t open my hotels, the patrons don’t have a hotel any more and the people who are happy to work on the weekend lose.”

But the Fair Work Commission isn’t having a bar of these commercial realities.

Nothing wrong with steep penalty rates, according to a recent decision. Expect a hefty increase in the minimum wage too.